US stocks shrug off weak August jobs data on mixed day for markets

Wall Street stocks shrugged off a disappointing August US jobs report Friday that could delay the phasing down of monetary stimulus, while Tokyo rose on stimulus hopes after Japan's prime minister signaled his exit.

The United States gained only 235,000 jobs last month, according to government data released on Friday, far below expectations and a possible harbinger that the Delta variant is harming the US economic recovery.

But US stocks had a muted reaction to the report, with the Nasdaq edging to third straight record.

The figure is likely to encourage the US Federal Reserve to hold off from beginning to wind down its stimulus to support the economy at its September meeting.

"Time will tell if this is just a speed bump for America's rapidly accelerating economy, or if job creation has genuinely veered off course," said Jay Mawji, managing director of global liquidity provider IX Prime.

"But the markets are focused on the Fed’s next move. Barring any surprises over the next couple of weeks, the Fed is likely to keep rates at their current low level, sending the dollar into the weekend deep in the red," he added.

Earlier, European stocks gave up early gains to finish lower.

Fed boss Jerome Powell last week indicated that the central bank would take it easy in winding down the financial support -- and would be even more careful in lifting interest rates -- but offered no timetable for doing so.

"If Fed Chair Powell was looking for cover to make his case for why the Fed should hold off on announcing a tapering plan at the September 21-22 FOMC meeting, he found it in today's release of the August Employment Situation Report," said analyst Patrick J. O'Hare at Briefing.com.

In Asia, Tokyo stocks jumped more than two percent after Yoshihide Suga said he will not run for his ruling party's leadership, effectively ending his tenure as premier and throwing wide open the race to succeed him.

Analysts said the gains were fueled by hopes the next leader will push for a huge spending package to support the virus-hit economy. Suga's rival in the race for the post last year, Fumio Kishida, on Thursday called for tens of trillions of yen in spending to battle the coronavirus pandemic.

Sydney, Seoul, Wellington, Taipei, Manila, Mumbai, Bangkok and Jakarta also rose.